Global Managerial Economics 2DB

400 Words

Part of a business owner’s costs when it comes to pricing, competition, manufacturing, and distribution are tariffs. Tariffs can be used by a country to increase its revenues or protect its own domestic industries. When expanding internationally, a business owner may run across countries that have tariff and nontariff distortions to trade.

Discuss the following issues regarding tariffs:

• How do countries use tariffs to increase revenues or protect industries?
  • How do they affect exports?
• Who benefits from tariffs?
  • Producers or consumers?
  • Small, developing countries or large, developed countries?
• What other costs are involved in importing and exporting?
• When are tariffs good, and when are they bad? Why?
• How does a business owner find out what tariffs exist in individual countries, and what percentage of the cost of imports and exports is from tariffs?
  • What government agencies in the United States provide this information?
• Should the United States use tariffs?
  • Why or why not?